Labourer Arthur Sodinga bought a small RDP house in 2008 after securing a R48,000 home loan with Standard Bank. But despite repaying almost R300,000 in the past 18 years, as of this week he still owed the bank more than R55,000.
Standard Bank claimed this was due to multiple costs and penalties on the original home loan and that the ballooning costs had been “appropriate and fair”.
But late on Friday, faced with an inquiry by the National Financial Ombud Scheme (NFO) and a story about the debacle in the Sunday Times, the bank said it would write off the remaining balance on Sodinga’s loan.
“Our aim has always been to help our customers stay in their homes and to treat each person’s circumstances with care,” the bank said. “In Mr Sodinga’s case, we’ve looked at this matter carefully. He is close to retirement, and we recognise how much pressure the outstanding balance would place on him in the years ahead.
“With that in mind, Standard Bank has decided to write off the balance on his home loan. This decision is simply a gesture of good faith for a customer we want to see retire with peace of mind.”
But the debt forgiveness comes only after years of back and forth.
I cannot bear to see Arnold being hammered like this,” he told the Sunday Times earlier in the week. “He trusted the system and got trapped in a disgusting arrangement. He signed a contract that was skewed and designed to milk an ignorant person
— Nick Harding
Sodinga, who has worked for the Harding family’s vintage furniture business Restorabilia in Bergvliet, Cape Town, for 35 years, is described by them as “a poorly educated, kind, hard-working and honest man”.
For Nick Harding, who owns the business and had taken up Sodinga’s battle with the bank, the decision marks the end of months of frustration and emotional strain.
Harding was granted power of attorney over the home loan account in 2016 and has managed it since.
Late last year, believing the loan should be close to settled, he approached the bank to find out what amount was outstanding. He was horrified to discover that despite having paid more than the required monthly instalment for years, the debt had climbed above the original loan amount.
“I cannot bear to see Arnold being hammered like this,” he told the Sunday Times earlier in the week. “He trusted the system and got trapped in a disgusting arrangement. He signed a contract that was skewed and designed to milk an ignorant person.”
But when approached by the Sunday Times this week, Standard Bank said it had acted according to standard protocols relating to RDP home purchases.
The original agreement required Sodinga to take out insurance on the house as well as life cover for himself and his wife and co-owner, Irene, to ensure the loan would be repaid should either of them die before the debt was settled.
Barend Stander, Standard Bank’s head of client experience and conduct risk, confirmed that Sodinga took out the loan in 2008. At the time, he owed R48,000 and paid instalments of R660 a month.
He said the bank had in the past tried to help Sodinga, and had even restructured his payments back in 2013. But he said Sodinga had continued with erratic payments and in 2016 had fallen into such arrears that the property would have been repossessed had Harding not stepped in and paid in R7,700 to cover arrears, legal costs and the amount needed to bring the loan up to date.
According to Stander, it was the early missed payments, penalties, interest and other costs that led to Sodinga now owing more than R55,000. His monthly instalment had risen to R1,572.49 — with the life insurance component escalating sharply after he turned 60, Stander said. The home loan contract still had more than 120 months remaining.
Harding said the debt had meant “Arnold’s dreams of retiring to his humble home in the Eastern Cape are in tatters”.
He said he had spent six months trying to resolve the issue with Standard Bank, but after negotiations stalled he decided to go public.
Harding’s daughters Jules Harding, who is the lead singer of the band Goodluck, and Nikki Banner, who runs the Backyard Cafe adjacent to Restorabilia, took to social media over Sodinga’s plight.
They generated more than 300,000 engagements online and launched crowdfunding efforts. They also took the matter to the NFO for investigation.
Sodinga told the Sunday Times he simply wants to own his home.
He was persuaded to continue working while the matter was investigated by NFO case administrator Cynthia Maremane, who convinced him not to cash in his pension to settle the debt.
“In the beginning I was struggling to pay for my house, and the bank wanted to take it. So I spoke to my boss, and he took over my loan,” Sodinga said. “Now I am 60 and want to retire, but I must keep working.”
After confirming on Friday evening that it would write off the debt, the bank said it would continue working with Harding ‘to bring the matter to a fair and dignified outcome’
Harding and Sodinga met bank officials, after which Harding was granted power of attorney and took over managing the account.
Harding says he arranged for all future contract changes to be communicated to him. But Standard Bank disputes this, saying there is no record of such an arrangement. The bank says it continued sending statements to Sodinga’s physical address every six months and could not be held responsible if he failed to properly read or understand them.
At the time Harding took over, the monthly instalment was R1,060. He began paying R1,100 a month and later persuaded Sodinga to increase payments to R1,400 to settle the debt faster.
What neither Harding nor Sodinga realised was that the contract allowed for annual 10% increases to the instalment amount, along with additional adjustments to the insurance component — which had climbed from R180 in 2008 to more than R500.
As a result, the instalment amount quickly exceeded the amount Harding was paying. To recover the shortfall, Standard Bank debited Sodinga’s account directly, but because there were insufficient funds the transactions were returned — triggering further bank charges and penalty fees.
Stander maintains the bank had handled the matter with empathy.
After confirming on Friday evening that it would write off the debt, the bank said it would continue working with Harding “to bring the matter to a fair and dignified outcome”.
Harding was informed by NFO banking adjudicator Kishen Pillay this week that the case remains under active investigation.
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